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Facebook Partnership Deal Allows Ads Based on Previous Purchases

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Background

On February 27, 2013, Facebook confirmed fast-spreading rumors about a new partnership with data gathering firms Acxiom, Datalogix, Epsilon and marketing data platform BlueKai. The partnership will expand Facebook’s Custom Audiences capabilities to provide advertisers with new opportunities to target consumers based on information about their offline shopping habits, online consumption and purchase behaviors.

While big brands have been using data firms for years to optimize their email, direct mail, and other digital media, this move by Facebook is a significant step towards providing social media advertisers with targeting capabilities to better reach and engage the consumer segments that matter most to them.

How it Works

In partnership with these data-gathering firms, Facebook anonymously matches consumer data lists from loyalty program members with the email addresses and phone numbers of Facebook users, which are used for registration in both cases. A process called “hashing” is applied as a measure of privacy and data-protection, helping to ensure the anonymity of the Facebook users to marketers.

The additional data will create new capabilities, allowing brands to access data relating to both offline purchases and older shopping habits. BlueKai’s cookie based integration with Facebook will allow brands to deliver ads targeted through cookie matching using data that may have been stored over long periods of time. The integration would allow ads to show up as sponsored stories rather than strictly FBX ads that only appear on the Right Hand Side. For example, a car dealer could reach out to those who visited its site a year ago.

Potentially more impactful is the new ability for brands to target users based on recent store purchases, an especially attractive capability for CPG marketers. For example, a brand can now only display ads to users who recently purchased their products, maximizing the impact of their messages while minimizing any wasteful media spend.

Resolution POV:

These new targeting capabilities provide advertisers with an unprecedented opportunity to reach the right consumers with the right messages. Not only can the most recent interests as well as groups of interests be targeted to engage new fans, but earlier shopping data can aid in customer retention. Resolution also hopes to overlay these new segments with existing Facebook targeting options to maximize effectiveness.

Advertisers should start to test and experiment, as an understanding of the most effective approaches will give competitive edge in this arena of aggressive competition for consumer attention. These are some of the first steps we recommend to take advantage of this update:

  1. Manipulate 3rd Party Data for Most Current Interests ─ Facebook targeting currently reaches those with specific interests, and many users do not consistently update this information. Marketers can take advantage of this third party data to hone in on relevant consumers who would not have been identified as such by Facebook’s native interest categories (for instance, an auto intender who isn’t a fan of any auto-related Facebook pages).
  2. Target Groups of Interests to Encourage Buying ─ Unlike Custom Audiences capabilities before this update, where brands could target only customers already in their databases, now advertisers will be able to reach a larger pool of consumers (for example, whereas previously an auto company could only reach consumers within their data base, they can now extend their reach to consumers who are within the category at large). As a result, brands can engage with potential consumers actively looking to make a purchase in their given category.
  3. Test New Targeted Ads in Newsfeed ─ BlueKai’s integration means that marketers should test ads with this new shopper as Sponsored Stories or Page Posts rather than the current limitation of solely FBX ads on the Right Hand Side. Newsfeed ads should garner better performance and higher engagement.
  4. Reach Out To Previous Customers ─ BlueKai functionality means that brands can retain customers who have made previous purchases and may be interested in follow-up engagement with the brand.

Summary

Facebook’s official announcement of its partnership with these three data mining firms as well as marketing data platform BlueKai has been an anticipated statement that will encourage more efficient marketing and can help brands more easily and efficiently reach their users. Additionally, it will help brands measure whether their Facebook activity can move the needle on purchases. Resolution will be recommending testing these new functionalities as soon as they become available.

For more information, visit the resource below:

http://adage.com/article/digital/facebook-announces-plan-show-ads-based-offline-shopping-habits/240054/